Should You Marry Someone With Debt?

Posted by Doug Murray on May 7, 2020

When saying their wedding vows, a lot of people don't think too much about the "for poorer" bit. However, financial trouble is a major contributor to unhappy marriages. In order not to get your hopes of eternal marital bliss dashed, it helps to know where you stand financially before tying the knot. Should you marry someone with debt? We've rounded up advice from the experts including the Financial Consumer Agency of Canada and RateSupermarket to help you make the decision.

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Your partner’s debt isn’t yours, but...

Let’s start with the good news. The pre-existing debt your partner brings to the marriage doesn’t become yours, and your doesn’t become your partner’s. Each of you is only responsible for the debt accrued in their name. There are caveats, however.

Your partner’s debt is yours if you co-signed

If you co-signed for a loan, you are both responsible for that debt. If one of you doesn’t pay, the creditor has every right to demand payment from the other and this will affect your credit score. So, before you both sign that mortgage with the best rate, be sure you both can afford it.

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Marriage will affect student loan repayment assistance

When your partner has a huge student loan debt to pay off and applies for repayment assistance, they must report your income, even if you’re a common law partner rather than a spouse. This will affect how much the monthly payment will be. It’s one thing to pay off student loans fast but it’s another when you’re essentially paying for a loan that’s not yours.

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Your partner’s debt will affect your going back to school

Say at some stage during your marriage you decide to go back to school and you apply for a student loan. Because you’re married, you have to report your partner’s income. If your partner has a lot of unpaid student debt, this can make you ineligible for a loan.

Joint credit cards can have a higher interest rate

It may make sense to open a joint credit card account for household expenses, for instance. However, if your partner has bad credit, this may mean that your card will come with a higher interest rate. If your partner overspends on the card, this will affect your credit rating too. One of the best ways to protect your finances from divorce is to avoid joint accounts.

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Be careful about making your spouse an added cardholder

Many of the best credit cards in Canada have the option of adding another cardholder to the account. If you add your partner as a cardholder on your account, you will be liable for any debt they accrue with that card.

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Be careful about being the added cardholder

It’s just as risky to become the added cardholder on your partner’s account. If they haven’t been managing that account responsibly, this may negatively affect your credit rating because that account will be added to your credit report.

Simply living together may not be the solution

You love each other but getting married will ruin your credit rating, so it’s better to just live together and save on the cost of a wedding too, right? Not so fast. The federal government will consider you common law partners if you’ve been living together for a year or more and legally you will be treated as spouses, with both the good and the bad that entails.

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Your partner’s debt may affect you after their death

When your partner dies, their debt won’t become your responsibility unless you co-signed on the loan, so you won’t necessarily have to resort to crime to survive. However, your partner’s creditors will demand repayment through the estate and that includes any assets you jointly own, such as the house.

Have "The Talk" before marriage

Deciding on whether or not to have children isn’t the only big talk you need to have before getting hitched. You also need to talk about how you will handle finances and debt and your financial goals, like retiring young. If a more financially responsible partner has to carry the debts of the more irresponsible partner, this can lead to resentment.